Correlation Between MINCO SILVER and Lamar Advertising
Can any of the company-specific risk be diversified away by investing in both MINCO SILVER and Lamar Advertising at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MINCO SILVER and Lamar Advertising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MINCO SILVER and Lamar Advertising, you can compare the effects of market volatilities on MINCO SILVER and Lamar Advertising and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in MINCO SILVER with a short position of Lamar Advertising. Check out your portfolio center. Please also check ongoing floating volatility patterns of MINCO SILVER and Lamar Advertising.
Diversification Opportunities for MINCO SILVER and Lamar Advertising
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MINCO and Lamar is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding MINCO SILVER and Lamar Advertising in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lamar Advertising and MINCO SILVER is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on MINCO SILVER are associated (or correlated) with Lamar Advertising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lamar Advertising has no effect on the direction of MINCO SILVER i.e., MINCO SILVER and Lamar Advertising go up and down completely randomly.
Pair Corralation between MINCO SILVER and Lamar Advertising
Assuming the 90 days trading horizon MINCO SILVER is expected to generate 6.85 times less return on investment than Lamar Advertising. In addition to that, MINCO SILVER is 1.41 times more volatile than Lamar Advertising. It trades about 0.01 of its total potential returns per unit of risk. Lamar Advertising is currently generating about 0.11 per unit of volatility. If you would invest 12,100 in Lamar Advertising on September 2, 2024 and sell it today you would earn a total of 500.00 from holding Lamar Advertising or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MINCO SILVER vs. Lamar Advertising
Performance |
| Timeline |
| MINCO SILVER |
| Lamar Advertising |
MINCO SILVER and Lamar Advertising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MINCO SILVER and Lamar Advertising
The main advantage of trading using opposite MINCO SILVER and Lamar Advertising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MINCO SILVER position performs unexpectedly, Lamar Advertising can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Lamar Advertising will offset losses from the drop in Lamar Advertising's long position.| MINCO SILVER vs. SIVERS SEMICONDUCTORS AB | MINCO SILVER vs. Darden Restaurants | MINCO SILVER vs. Reliance Steel Aluminum | MINCO SILVER vs. Q2M Managementberatung AG |
| Lamar Advertising vs. Nishi Nippon Railroad Co | Lamar Advertising vs. Liberty Broadband | Lamar Advertising vs. NXP Semiconductors NV | Lamar Advertising vs. MINCO SILVER |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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